For the week of August 9, 2021
Recap of last week: Rates slightly worse
Average mortgage rates improved some to start the week last week, but lost ground in the second half of the week to end the week slightly worse than the previous week. Friday's jobs data showed strength in the labor market, one of the indicators the Fed will use when deciding to reduce the bond purchases that have kept mortgage rates low, and helped push rates higher to end the week.
Mortgage Rate Forecast: Rates could go either way
Average mortgage rates this week have a good shot at rebounding after losing ground last week, although we may see rates end the week still slightly worse than recent best levels. We need to see how markets react to this week's inflation data though, because a negative reaction could pressure mortgage rates higher for the week instead.
What's affecting rates this week:
- Fed stimulus: The Fed continues to buy Treasuries and mortgage bonds, helping keep mortgage rates low. If we see market concerns grow around speculation that the Fed could reduce bond purchases by the end of the year it could pressure rates higher.
- Economic data: Data on consumer and wholesale inflation will be released this week. Also multiple bond auctions this week could have a small effect on rates.
